The key interest rate was lowered by 75 basis points to 8.25% at the latest rate-setting meeting of the National Bank of Hungary (MNB). The decision underscores that the acceleration of the interest rate reduction cycle to a 100 basis points cut in February was only temporary.
The year-end brought a positive surprise with inflation data that was more favorable than expected. Due to the lower index, the National Bank of Hungary (MNB) might accelerate its interest rate cuts, at least temporarily, Deputy Governor Barnabás Virág indicated at a recent press conference.
The Hungarian government is reportedly considering asking the European Central Bank (ECB) to allow the National Bank of Hungary (MNB) to operate with negative equity after soaring interest rates look set to plunge the central bank into a record loss, according to intellinews.com.